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“reason to believe”

ReassessmentSection 147Section 1474,202 judgments

The decision most relied on for reason to believe is CIT v. Kelvinator of India Ltd. (320 ITR 561), cited in 1,673 judgments on BharatTax.

Leading authorities on reason to believe

CIT v. Kelvinator of India Ltd.
320 ITR 561 · 2010 · Supreme Court
1,673
citing judgments

An Assessing Officer cannot initiate reassessment proceedings under Section 147 of the Income Tax Act based on a mere change of opinion. Reassessment is permissible only when there is fresh tangible material leading to the belief of income escapement, not merely a review of existing facts.

CIT v. Durga Prasad More
82 ITR 540 · 1971 · Supreme Court
1,579
citing judgments

Tax authorities must judge evidence using the test of human probabilities and consider the apparent as real until there are reasons to believe it is not. They can rely on circumstantial evidence and the preponderance of probabilities to determine the genuineness of transactions.

ACIT v. Rajesh Jhaveri Stock Brokers Pvt. Ltd.
291 ITR 500 · 2007 · Supreme Court
1,030
citing judgments

For initiating reassessment proceedings under Section 147, the Assessing Officer needs only prima facie material providing a reason to believe that income has escaped assessment. Conclusive proof or the sufficiency/correctness of the material is not required at the stage of issuing the notice under Section 148.

Raymond Woollen Mills Ltd. v. ITO
236 ITR 34 · 1999 · Supreme Court
862
citing judgments

For reassessment proceedings under Section 148, the Assessing Officer only needs prima facie material to have a reason to believe income has escaped assessment. Conclusive proof or evaluation of the sufficiency and correctness of such material is not required at the stage of issuing the notice.

ITO v. Lakhmani Mewal Das
103 ITR 437 · 1976 · Supreme Court
721
citing judgments

For reassessment proceedings, the 'reason to believe' that income has escaped assessment must be based on some material and not mere suspicion, establishing a live link between the information and the belief. Furthermore, for reassessment beyond four years, there must be a specific finding of the assessee's failure to disclose fully and truly all material facts.

CIT v. Jet Airways (I) Ltd.
331 ITR 236 · 2011 · High Court
694
citing judgments

The Assessing Officer loses jurisdiction and the entire reassessment becomes invalid if no addition is made in respect of the income that formed the basis of the reopening. Explanation 3 to Section 147 does not permit assessing other escaped income unless an addition is made for the original income forming the reason to believe.

PCIT v. Meenakshi Overseas Pvt. Ltd.
395 ITR 677 · 2017 · High Court
471
citing judgments

Reassessment proceedings initiated solely based on an investigation wing/appraisal report, without the Assessing Officer's independent application of mind to form a 'reason to believe' that income has escaped assessment, are beyond jurisdiction, bad in law, and void ab initio.

CIT v. Kelvinator of India Ltd.
256 ITR 1 · 2002 · High Court
439
citing judgments

An Assessing Officer cannot reopen an assessment under Section 147 based on a mere change of opinion regarding the same material available during the original assessment. Reopening requires fresh, tangible material or information that leads to a reason to believe income has escaped assessment.

Judgments citing reason to believe

Pitti Holdings Private Limited, Hyderabad vs. ACIT., Central Circle-1(1), Hyderabad

In the result, the appeal of the assessee is allowed

ITA 450/HYD/2025[2018-19]Status: DisposedITAT Hyderabad08 Oct 2025AY 2018-19

Bench: Shri Vijay Pal Rao & Shri Madhusudan Sawdiaआ.अपी.सं /Ita No.450/Hyd/2025 (िनधा"रण वष"/Assessment Year:2018-19) M/S. Pitti Holdings Pvt. Asst. Commissioner Of Vs. Ltd., Hyderabad. Income Tax, Central Circle Pan: Aagcp3824Q 1(1), Hyderabad. (Appellant) (Respondent) िनधा"रती "ारा/Assessee By: Shri A. Srinivas, C.A. राज" व "ारा/Revenue By: Dr. Sachin Kumar, Dr सुनवाई की तारीख/Date Of Hearing: 09/09/2025 घोषणा की तारीख/Pronouncement: 08/10/2025

For Appellant: Shri A. Srinivas, C.AFor Respondent: Dr. Sachin Kumar, DR
Section 148Section 148A

stands and without adding (sic) deducting from the words used by Parliament, it is clear that upon (sic) formation of a reason to believe u/s 147 and following the issuance of a notice u/s 148, the Assessing Officer has the power assess or reassess the income which he has reason ... conjunctive. Evidently, therefore, what Parliament intends by use of the words ""and also"" is that the Assessing Officer, upon the formation of a reason to believe u/s 147 and the issuance of a notice u/s 148(2) must assess or reassess: (i). ''such income''; and also (ii) (sic) other income

Shri Parin Seventilal Shah, Mumbai vs. Assistant Commissioner of Income Tax Central Circle 1(2), Mumbai

In the result, the appeal of the assessee is allowed

ITA 3690/MUM/2025[2013-14]Status: DisposedITAT Mumbai08 Oct 2025AY 2013-14
Section 10(38)Section 143(3)Section 147Section 234ASection 254(1)Section 271(1)(c)Section 68

income of assessee has escaped assessment. The reason recorded must be specific. Power to reopening the assessment is condition on the formation of reason to believe that income chargeable to tax has escaped assessment. Such power is not like a power of review. No reassessment is permissible to make ... enquiry for verification. The words “Has reasons to believe" prescribed under section 147, this words are stronger than “it satisfied". The satisfaction of assessing officer must not be arbitrary or irrational. The reasons recorded cannot be supplemented or substituted. Mere suspicious or incomplete information cannot be basis of reassessment income

Sanjay Motiramji Muley, Nagpur vs. ITO Ward (4)(3), Nagpur

In the result, assessee’s appeal is allowed for statistical purposes

ITA 4/NAG/2025[2008-09]Status: DisposedITAT Nagpur07 Oct 2025AY 2008-09

Bench: Shri Pavan Kumar Gadalesanjay Motiramji Muley, Ward No.7, Mahajan Pura ……………. Appellant Bhandara Road, Pardi Nagpur 440008. Pan – Akdpm6463G V/S Income Tax Officer ……………. Respondent Ward–4(4), Nagpur Assessee By : Ms. Alfiya Rozie.Ar Revenue By :Shri Surjit Kumar Saha.Sr.Dr

For Appellant: Ms. Alfiya Rozie.ARFor Respondent: Shri Surjit Kumar Saha.Sr.DR
Section 142(1)Section 143(2)Section 144Section 147Section 148Section 50C

Officer has received information that the assessee has sold immovable property and the income was not offered to tax. The Assessing Officer has reason to believe that the income has escaped assessment and issued notice under section 148 of the Income Tax Act, 1961 (for short "the Act"). Further, notice

Subhash Badriprasad Shahu, Nagpur vs. ITO Ward 4(3), Nagpur

In the result, the appeal filed by the assesee is partly allowed

ITA 421/NAG/2024[2018-19]Status: DisposedITAT Nagpur07 Oct 2025AY 2018-19

Bench: Shri Pavan Kumar Gadalesubhash Badriprasad Shahu, Plot No.84, Near Annapurna Dall Mill, Bagad Ganj, Small Factory Area ……………. Appellant Nagpur 440 008. Maharashtra. Pan – Agqps9660N V/S Income Tax Officer ……………. Respondent Ward–4(3), Nagpur Assessee By :Shri. Abhay Agrawal.A.R. Revenue By :Shri Surjit Kumar Saha.Sr.Dr

For Appellant: Shri. Abhay Agrawal.A.RFor Respondent: Shri Surjit Kumar Saha.Sr.DR
Section 147Section 148Section 250Section 69C

Sanket Steel Enterprises for the F.Y. 2017–18 aggregating to Rs.32,02,255/- which is a nonexistent entity. The Assessing Officer has reason to believe that the income has escaped assessment and issued notice under section 148 of the Income Tax Act, 1961 (for short "the Act"). The assessee

Jagdish Solanki, Jhabua vs. Income Tax Officer Jhabua, Jhabua

ITA 169/IND/2025[2017-18]Status: DisposedITAT Indore07 Oct 2025AY 2017-18

Bench: Shri B.M. Biyani & Shri Paresh M. Joshi

आयकर अपीलीय अधिकरण, इंदौर न्यायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI B.M. BIYANI, ACCOUNTANT

Abhishek Gourasaria, Jamshedpur vs. ACIT, Jamshedpur

In the result, consequential assessment order also stands quashed

ITA 43/RAN/2023[2013-14]Status: DisposedITAT Ranchi06 Oct 2025AY 2013-14

Bench: Shri George Mathan & Shri Ratnesh Nandan Sahayabhishek Gourasaria, A.C.I.T., 118, Flat No. 2B, Surabhi Apartment, K Jamshedpur Vs. Road, Bistupur, Jamshedpur-831001. Pan No. Adwpg 2149 R Appellant/ Assessee Respondent/ Revenue

Section 139Section 147Section 148Section 149Section 151Section 153Section 153ASection 153C

investigation department that is too not related to Assessee in any way and thus have not acted upon his own reason to believe. The action of Ld. Assessing Officer is without Jurisdiction. Reliance may be placed on the following judgments in this regard It has been held in the following

Narendra Kachrulal Abad, Jalna vs. Income-Tax Officer, Ward - 1, Jalna

In the result, appeal of the assessee partly allowed

ITA 866/PUN/2019[2009-10]Status: DisposedITAT Pune06 Oct 2025AY 2009-10

Bench: Dr.Dipak P. Ripote & Shri Vinay Bhamoreआयकर अपऩल सं. / Ita No.866/Pun/2019 निर्धारण वषा / Assessment Year: 2009-10 Shri Narendra Kachrulal Abad, V The Income Tax Officer, Abad House, Nal Galli, S Ward-1, Jalna. Kadrabad, Jalna – 431203. Maharashtra. Pan: Acspa9531C Appellant/ Assessee Respondent / Revenue Assessee By Shri Hari Krishan – Ar Revenue By Shri Arvind Renge –Addl.Cit(Dr) Date Of Hearing 28/07/2025 Date Of Pronouncement 06/10/2025 आदेश/ Order Per Dr. Dipak P. Ripote, Am: This Is An Appeal Filed By Assessee Against The Order Of Ld.Commissioner Of Income Tax(Appeal)-1, Aurangabadpassed Under Section 250 Of The Income Tax Act, 1961 For The A.Y.2009-10 Dated 30.03.2019, Emanating From Order U/S.143(3) R.W.S 147Of The Income Tax Act, 1961, Dated 03.11.2017. The Assessee Has Raised The Following Concise Grounds Of Appeal :

Section 143(3)Section 148Section 250

Income Tax (Appeals). Arguments/Submissions. (a) (i) Re-opening of assessment has been done by the Assessing Officer on borrowed satisfaction. When the reasons to believe that income has escaped assessment are based, just on the information received from the Investigating Wing without any verification/examination of the facts of the assessee ... which resulted in net reduction in income due to CCM of Rs.9,54,365/-, therefore I have 4 ITA No.866/PUN/2025 [A] reasons to believe that the income chargeable to tax at Rs.9,54,365/- has escaped assessment. The Assessing Officer has not mentioned in respect of which transactions

Tigerhill Tradelink Private Limited, Kolkata vs. ITO, Ward 10(2), Kolkata

In the result, the appeal of the Appellant is Dismissed

ITA 956/KOL/2025[2014-2015]Status: DisposedITAT Kolkata03 Oct 2025AY 2014-2015

Bench: Shri George Mathan & Shri Rakesh Mishra

Section 144BSection 147Section 148Section 148ASection 151Section 151ASection 250Section 271BSection 68

Assessing Officer under section 147 by issuing notice under section 148 of the Act are bad in law as there is no reason to believe that the income of the appellant has escaped assessment and further, the case has been reopened only on the basis of borrowed transaction. The Appellant

Tigerhill Tradelink Private Limited, Kolkata vs. ITO, Ward 10(2), Kolkata

In the result, the appeal of the Appellant is Dismissed

ITA 955/KOL/2025[2014-2015]Status: DisposedITAT Kolkata03 Oct 2025AY 2014-2015

Bench: Shri George Mathan & Shri Rakesh Mishra

Section 144BSection 147Section 148Section 148ASection 151Section 151ASection 250Section 271BSection 68

Assessing Officer under section 147 by issuing notice under section 148 of the Act are bad in law as there is no reason to believe that the income of the appellant has escaped assessment and further, the case has been reopened only on the basis of borrowed transaction. The Appellant

Late Shri Jitendra Nagar Through His L/R Smt. Deepika Nagar, Baran vs. Income Tax Officer Ward Baran, Baran

In the result, appeal of the assessee is allowed

ITA 1382/JPR/2024[2016-2017]Status: DisposedITAT Jaipur01 Oct 2025AY 2016-2017

Bench: The Date Of Hearing.”

For Appellant: Shri Sidharth Ranka, AdvFor Respondent: Shri. Gautam Singh Choudhary, JCIT a
Section 133(6)Section 142(1)Section 144Section 147Section 148Section 148ASection 151Section 250Section 69A

assessee deposited cash of Rs. 16,90,000/- in his bank account on 24.11.2015 relevant to A.Y. 2016-17. Therefore, the AO had reason to believe that income amounting to Rs. 16,90,000/- escaped assessment in the hands of the assessee for the AY 2016-17 in the light

Pelican Tobacco India Private Limited vs. ITO, Ward - 19(4), New Delhi

Appeal is allowed

ITA 129/DEL/2024[2012-13]Status: DisposedITAT Delhi01 Oct 2025AY 2012-13

Bench: Sh. Satbeer Singh Godara & Sh. Avdhesh Kumar Mishra

For Appellant: Sh. Udit Dad, AdvFor Respondent: Sh. Om Prakash, Sr. DR
Section 143(2)Section 147Section 148Section 2

contained in sub-section (2) of section 143 of the Act is mandatory and the Legislature in its wisdom by using the word „reason to believe' had cast a duly on the Assessing Officer to apply mind to the material on record and after being satisfied with regard to escaped

Vivek Sharma, Jaipur vs. ITO Ward 1, Bharatpur

In the result, the appeal of the assessee is allowed

ITA 897/JPR/2025[2013-14]Status: DisposedITAT Jaipur30 Sept 2025AY 2013-14

Bench: Him.

For Appellant: Sh. Dheeraj Borad, CAFor Respondent: Sh. Gautam Singh Choudhary, JCIT
Section 115BSection 142(1)Section 147Section 148Section 250Section 68

Bank Limited in the ITR for the relevant period. Hence, the cash deposit was not offered to tax. Accordingly, it was reason to believe that the said amount of income of the assessee from undisclosed sources had escaped assessment. Based on that reason to believe the case of the assessee ... Bank Limited in the ITR for the relevant period. Hence the cash deposit was not offered to tax. Accordingly, it was reason to believe that the said amount of income of the assessee from undisclosed 13 Vivek Sharma vs. ITO sources has escaped assessment. Based on that reason to believe

Late Ashvinbhai Umedbhai Patel (Deceased) by Legal Heir Smit Ashvinbhai Patel, Kheda vs. The ITO, Ward-1, Nadiad

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 1106/AHD/2025[2011-12]Status: DisposedITAT Ahmedabad30 Sept 2025AY 2011-12
Section 271(1)Section 271CSection 69Section 69A

reassessment proceedings initiated were without jurisdiction in view of legal position decided by binding judgments that deposit in bank account cannot be a reason to believe that such deposits are income and have escaped assessment. The order of assessment itself being illegal and without jurisdiction, penalty levied ought ... Counsel also submitted that the reassessment proceedings were without jurisdiction as deposit in a bank account by itself does not constitute “reason to believe” that income has I.T.A No. 1105 & 1106/Ahd/2025 A.Y. 2011-12 8 Late Ashvinbhai Umedbhai Patel (deceased) By Legal Heir Smit Ashvinbhai Patel vs. ITO escaped assessment

Late Ashvinbhai Umedbhai Patel (Deceased) by Legal Heir Smit Ashvinbhai Patel, Kheda vs. The ITO, Ward-1, Nadiad

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 1105/AHD/2025[2011-12]Status: DisposedITAT Ahmedabad30 Sept 2025AY 2011-12
Section 271(1)Section 271CSection 69Section 69A

reassessment proceedings initiated were without jurisdiction in view of legal position decided by binding judgments that deposit in bank account cannot be a reason to believe that such deposits are income and have escaped assessment. The order of assessment itself being illegal and without jurisdiction, penalty levied ought ... Counsel also submitted that the reassessment proceedings were without jurisdiction as deposit in a bank account by itself does not constitute “reason to believe” that income has I.T.A No. 1105 & 1106/Ahd/2025 A.Y. 2011-12 8 Late Ashvinbhai Umedbhai Patel (deceased) By Legal Heir Smit Ashvinbhai Patel vs. ITO escaped assessment

Late Shri Chhatrasinh J.Vaghela Thru L/H Kamlaben C.Vaghela, Gandhinagar vs. The Income Tax Officer, Ward-1, Gandhinagar

In the result, the appeal of the assessee is allowed

ITA 828/AHD/2019[2012-13]Status: DisposedITAT Ahmedabad30 Sept 2025AY 2012-13

Bench: Dr. B Before Dr. B.R.R. Kumar Kumar, , , , Vice Vice-Before Before Dr. B Dr. B Kumar Kumar Viceshri Siddhartha Nautiyal Shri Siddhartha Nautiyalshri Siddhartha Nautiyal Shri Siddhartha Nautiyallate Shri Chhatrasingh J. Vs. Vaghela, Income-Tax Officer, Through L/H Kamlaben C. Ward-1, Vaghela, At & Post : Sargasan, Gandhinagar Sargasan, Gandhinagar-382421 [Pan : Atnpv 4710 C]

For Appellant: Appellant byFor Respondent: Respondent by Shri B.P. Srivastava, Sr DR
Section 139(4)Section 143(3)Section 147Section 148Section 250Section 54B

record. 4.1 We find that the notice issued under section 148 of the Act reads as under:- “Date : 19/12/2014 …….. Whereas I have reason to believe that your income/the income of Α.Υ. 2012- 13 in respect of which you are assessable chargeable to tax for the assessment year ... filed the return of income, therefore with a view to verifying calculation of capital gain and other income. Therefore, I have reason to believe that the income chargeable to tax had escaped assessment to that extent, for A.Y 2012-13, within the meaning of Section 147 of the Act. Hence

Income Tax Officer Ward-22(1)(1), Mumbai vs. Gopal Ramchand Kanjani, Mumbaifh

ITA 733/MUM/2025[2012]Status: DisposedITAT Mumbai30 Sept 2025

Bench: Justice (Retd.) C V Bhadang & Ms Padmavathy S, Am

For Appellant: Shri M. Subramaniam, AR
Section 143(1)Section 147Section 148Section 250Section 69C

apparent from any information in the return. Section 147 confers jurisdiction to reassess the income of the assessee if the AO has a reason to believe that the income has escaped assessment i.e.at the stage of issue of notice, the only question is whether there are relevant materials on which ... under section 143(3), the AO in order to assume jurisdiction beyond four years for reassessment, need to fulfil one more condition that, reason to believe of escapement has occurred by reason of omission or failure on the part of the assessee to disclose fully or truly all material facts

Setron Textile Mills Pvt Ltd, Mumbai vs. Income Tax Officer, Ward 4(3)(1), Mumbai

In the result the appeal filed by the assessee stands allowed

ITA 4847/MUM/2025[2014-15]Status: DisposedITAT Mumbai30 Sept 2025AY 2014-15

Bench: Smt. Beena Pillai () & Shri Omkareshwar Chidara ()

Section 143Section 147Section 148

held that for initiation of reassessment proceedings, it is sufficient if there is a prima facie reason to believe that income has escaped assessment; the adequacy or correctness of the material cannot be questioned at this stage. Further, in A. A. Trading Co. v. ITO [(2019) 102 taxmann.com

Umbrella Hospitality Private Limited, Mumbai vs. Assistant Commissioner of Income Tax Central Circle 6(2), Mumbai

In the result, the ground no

ITA 1640/MUM/2025[2016-17]Status: DisposedITAT Mumbai30 Sept 2025AY 2016-17

Bench: Shri Vikram Singh Yadav, Am & Ms. Kavitha Rajagopal, Jm

For Appellant: Shri Ajay R. Singh, Adv. & ShriFor Respondent: Shri Vivek Perampurna, (CIT-DR)
Section 132(1)Section 143(1)Section 143(2)Section 143(3)Section 148Section 250Section 68Section 69C

extract of the relevant provision is cited herein under for ease of reference: “Income escaping assessment. 147. If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess

Umbrella Hospitality Private Limited, Mumbai vs. Assistant Commissioner of Income Tax Central Circle 6(2), Mumbai

In the result, the ground no

ITA 1450/MUM/2025[2019-20]Status: DisposedITAT Mumbai30 Sept 2025AY 2019-20

Bench: Shri Vikram Singh Yadav, Am & Ms. Kavitha Rajagopal, Jm

For Appellant: Shri Ajay R. Singh, Adv. & ShriFor Respondent: Shri Vivek Perampurna, (CIT-DR)
Section 132(1)Section 143(1)Section 143(2)Section 143(3)Section 148Section 250Section 68Section 69C

extract of the relevant provision is cited herein under for ease of reference: “Income escaping assessment. 147. If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess

Umbrella Hospitality Private Limited, Mumbai vs. Assistant Commissioner of Income Tax Central Circle 6(2), Mumbai

In the result, the ground no

ITA 1449/MUM/2025[2018-19]Status: DisposedITAT Mumbai30 Sept 2025AY 2018-19

Bench: Shri Vikram Singh Yadav, Am & Ms. Kavitha Rajagopal, Jm

For Appellant: Shri Ajay R. Singh, Adv. & ShriFor Respondent: Shri Vivek Perampurna, (CIT-DR)
Section 132(1)Section 143(1)Section 143(2)Section 143(3)Section 148Section 250Section 68Section 69C

extract of the relevant provision is cited herein under for ease of reference: “Income escaping assessment. 147. If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess